The Thorny Issue of Net Neutrality

The issue of net neutrality is often portrayed (by both sides) as a black-and-white matter, where either the government is aiming to take control of private network infrastructure or greedy telecom companies are looking for ways to wring money from companies and consumers. In a Washington Post column, Jeffrey H. Birnbaum notes that “commercials on either side of the [net neutrality] issue are confusing, opaque or downright deceptive.” That is because the topic is more than just a matter of whether telecommunication companies (telcos) can charge network users like Google and Yahoo extra for so-called premium services or otherwise control the flow of data through their networks. Regardless of what side of the debate you take, recognizing the complicating factors that tangle the issue is important to a nuanced and reasonable position.

Private Property Rights—Slow Down, There

Tim Wu, a professor at Columbia Law School, defines net neutrality as “a network design principle”: “a maximally useful public information network aspires to treat all content, sites, and platforms equally.” Strong proponents of private property might be quick to say that although such an approach is fine if a telco chooses it, that telco should not be forced to operate its private infrastructure equipment in a manner prescribed by the government. On its face, this argument has some appeal: after all, imagine a “car neutrality” policy that allowed anyone to use anyone else’s car, since the highways are public. The analogy here isn’t precise, but it illustrates the concern.

The problem is that telcos are not private companies. They are essentially monopolistic entities roughly (but not entirely) on par with the U.S. Post Office. Although they have the veneer of a private company, they rely heavily on government power to enable their infrastructure and stifle competition. Try, for instance, to fight a utility company over a new easement through your property. These conditions mean that telcos cannot justify claiming the same rights as truly private companies.

A knee-jerk reaction might be to simply remove any special regulatory considerations for telcos and let them fight for customers just like most other businesses. In a suburbanized nation, however, where land is divided, subdivided and sub-subdivided, imagine the headaches of actually delivering services to customers, particularly those in landlocked tracts away from public roads (which can and do offer relatively trouble-free easements—although it’s amusing when utilities charge customers for the cost of using public rights-of-way). Even ignoring such logistical issues, Andy Kessler observes at The Weekly Standard that “even if you end the monopolies, the incumbents have the advantage of a huge head start.”

Deregulation of telcos and easing of restrictions on competition is worth considering, but in the current system, appeals to private property in order to oppose net neutrality fail to consider that the rules are simply too muddled to allow such argumentation free and clear. Like it or not, the issue must deal with the mess created by entangling huge telcos and governments in the name of the “public good”—a murky concept that could enable all manner of shenanigans.

Net Neutrality: Six of One or a Half-Dozen of the Other

One of the mantras of parties on both sides of the debate is, ironically, that consumers should control the Internet (one side might say in the name of the “public good,” and the other might say in the name of letting consumers pay for what they want and not what someone else wants). But in either case, the government still maintains control.

For instance, assume net neutrality is upheld. Presumably, then, government regulators would have the authority to compel or proscribe certain activities on the part of telcos—for instance, not allowing cable provider Comcast to charge Google for transmitting YouTube videos under pain of bandwidth throttling. On the other hand, even if net neutrality is shot down, the government still doles out monopoly rights to the telcos. And you’re still stuck with dialup if you happen to be in one of those loathsome rural locations that CenturyLink and Comcast (or some similar faceless telco) refuse to serve with broadband access—effectively a throttling of all traffic because the monopoly faces no competition.

In either case, consumers will foot the bill, whatever the megacompanies and gargantuan government agencies decide. “First, regulators and/or legislators will have to decide one way or the other…Washington is involved, like it or not, no matter what the outcome,” said Birnbaum. And “consumers will pay the freight any way you look at it. That’s Economics 101. They will either pay the telephone and cable companies via higher rates, or they will pay the online firms the same way.”

Does the Outcome Even Matter?

Despite shrill claims from both sides of the debate, the outcome of legal proceedings and legislation regarding net neutrality may actually make little difference in how the Internet develops. For instance, The Washington Post notes that despite the FCC’s net neutrality rules, “In 2010, Comcast forced the backbone provider Level 3 to pay it to upgrade its network to pay for increased traffic from video streaming giant Netflix. Technically this didn’t violate network neutrality, which is a rule about network administration, not network upgrade decisions. But…Netflix was effectively forced to pay extra to deliver its content to Comcast customers.”

Even if telcos were to prioritize some traffic over others (which, in all likelihood, will overwhelmingly relate to video), the idea that they will either block or throttle ecommerce, political or press sites to the point of uselessness is farfetched. These companies still have some fear of public disapproval—the C word (censorship) can quickly rile the public, regardless of whether it accurately applies—and they remain under the thumb of government regulators regardless of the particulars of policy. Censoring controversial web content could easily be remedied by a call from a lobbyist, leading to subpoenas of telco executives to appear before various Congressional committees. So, the threat of either net neutrality or its absence is probably overblown.

Conclusions

The problem with the net neutrality debate is the lack of a clean slate to defend either model of the Internet. Telcos are not private companies in any honest sense of the word, so they cannot take unmitigated refuge in the concept of private property. On the other hand, these companies still aim to make a profit, so no matter what the legislation or regulations say, they will find some way around them if traffic prioritization can garner a return. In addition, attempting to treat telcos as purely public entities is likewise unwarranted. They are not simply about serving the “public good” (whatever that might be), so generalizing their mission as simply being to deliver the same service quality for any traffic to any individual, without qualification, is unrealistic—lest these companies become the digital equivalents of the Post Office, which only exists because of its monopoly on mail. Essentially, then, net neutrality is less far reaching a topic than proponents and opponents would insist. Apart from a clearer discussion of the precise public/private nature of telcos and thus the abstract entity known as the Internet, no rational basis for a clear-headed resolution exists. But the alarmist claims of both sides will still make for entertaining theater.

Jeff Clark is editor for the Data Center Journal. He holds a bachelor’s degree in physics from the University of Richmond, as well as master’s and doctorate degrees in electrical engineering from Virginia Tech. An author and aspiring renaissance man, his interests range from quantum mechanics and processor technology to drawing and philosophy.